JPMorgan Sees Korea Governance Overhaul Driving Equity Deals

Article content(Bloomberg) — A record rally in South Korean stocks is spurring a wave of share sales by existing holders, a trend set to accelerate as companies unwind cross-shareholdings and simplify ownership under a corporate governance overhaul, according to JPMorgan Chase & Co.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentThe pickup in deals is being driven by governance‑led stake moves and strategic selldowns, while demand is anchored by high-quality foreign investors, said Jinsoo Ha, head of Korea equity capital markets at JPMorgan. A total of six block trades has raised about $1.3 billion so far this year, compared with about $296 million in the first quarter of 2025, according to data compiled by Bloomberg.Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle content“Though we are cautious, we are optimistic on block activity picking up further over the course of this year,” Ha said. “Governance reforms have been an important driver of the market rally, which has been supportive of” activity in equity capital markets.Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article contentKorean stocks have more than doubled over the past year, driven by investors chasing gains in chip heavyweights like Samsung Electronics Co. and SK Hynix Inc. Adding fuel to the rally, President Lee Jae Myung has championed a corporate-governance overhaul to tackle the so-called “Korea discount” by improving capital efficiency and dismantling opaque ownership structures.Article contentEven as the war in Iran roiled markets, deals have perked up, partly as a result of efforts to improve corporate governance, especially with shareholder meetings approaching. Major transactions last week involved chaebols unwinding cross-holdings, long criticized by foreign investors as depressing valuations.

Hanwha Systems Co. plans to offload a stake worth 1.7 trillion won ($1.2 billion) in Hanwha Ocean Co, while SK Group affiliate SK Discovery Co. agreed to sell its stake in renewable energy firm SK Eternix Co. to KKR & Co.Article contentArticle content“Monetization transactions, including blocks, can be an effective way for corporates and key stakeholders to align with the reforms,” Ha added.Article contentThis year’s haul of block trades so far also includes transactions exceeding $200 million involving the shares of LG CNS Co., HD Hyundai Marine Solution Co., Classys Inc. and HPSP Co.Article contentIn contrast with block trade activity, new issuance has lagged, with $3.4 billion raised from initial public offerings in 2025, just slightly eclipsing each of the previous two years’ proceeds. In a sign of the weak demand that may further slow fresh listings, digital lender K Bank Co.’s shares are trading below the offer price after a debut during this month’s market turmoil. Article contentAn “IPO has a much longer preparation period compared to blocks, hence deal interest takes longer to build itself into a tangible pipeline,” Ha said.Article contentTrending Chinese oil buyers pay premium for Canadian crude amid Iran war Oil & Gas Here's why bets are rising for interest rate hikes including for Canada Economy Subprime firm Goeasy dives 39% as trouble emerges in auto loans Investor Saudi Aramco chief warns of ‘catastrophic consequences’ in biggest crisis region's oil market has faced Oil & Gas Qatar to push LNG expansion plans to 2027 after Iran drone attack Oil & Gas Share this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. Chinese oil buyers pay premium for Canadian crude amid Iran war Oil & Gas Here's why bets are rising for interest rate hikes including for Canada Economy Subprime firm Goeasy dives 39% as trouble emerges in auto loans Investor Saudi Aramco chief warns of ‘catastrophic consequences’ in biggest crisis region's oil market has faced Oil & Gas Qatar to push LNG expansion plans to 2027 after Iran drone attack Oil & Gas